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S.176

Introduced by   Committee on Economic Development, Housing and General Affairs

Referred to Committee on

Date:

Subject:  Public service; regulation of corporations; transmission facilities; cogeneration collaborative; Vermont Electric Cooperative; green buildings

Statement of purpose:  This bill proposes to authorize the public service board to order compensation to municipal intervenors, requires the burial of transmission lines in sensitive areas, requires the preparation of a Vermont bulk electric system reliability plan by transmission and distribution companies, adds appropriate combined heat and power systems to the measures that the energy efficiency utility may offer, removes the cap on the amount that may be raised by the energy efficiency charge, creates a cogeneration collaborative to design cogeneration, provides that Vermont Electric Cooperative may recoup in its rates the cost of cogeneration projects in Beecher Falls and in Richford, and orders a study of possible standards and incentives for the construction of green buildings.

AN ACT RELATING TO THE PUBLIC SERVICE BOARD AND UTILITY REGULATION

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  30 V.S.A. §§ 34 and 35 are added to read:

§ 34.  INTERVENOR FUNDING

(a)  For the purposes of this section:

(1)  “Compensation” means payment for all or part, as determined by the board, of reasonable advocate fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a proceeding, including the fees and costs of obtaining an award under this section and section 35 of this title and of obtaining judicial review, if any.

(2)  “Expert witness fees” means recorded or billed costs incurred by a customer for an expert witness.

(3)  “Other reasonable costs” means reasonable out-of-pocket expenses directly incurred by a customer that are directly related to the contentions or recommendations made by the customer that resulted in a substantial contribution.

(4)  “Party” means any interested party, respondent public utility, or board staff in a hearing or proceeding.

(5)  “Proceeding” means an application, complaint, or investigation, rulemaking, alternative dispute resolution procedures in lieu of formal proceedings as may be sponsored or endorsed by the board, or other formal proceeding before the board.

(6)  “Substantial contribution” means, in the judgment of the board, that the municipality’s presentation has substantially assisted the board in the making of its order or decision because the order or decision has adopted in whole or in part one or more factual contentions, legal contentions, or specific policy or procedural recommendations presented by the customer.  Where the municipality’s participation has resulted in a substantial contribution, even if the decision adopts that municipality’s contention or recommendations only in part, the board may award the municipality compensation for all reasonable advocate fees, reasonable expenses, and other reasonable costs incurred by the municipality in preparing or presenting that contention or recommendation.

(b)  Participation by a municipality that materially supplements, complements, or contributes to the presentation of another party may be fully eligible for compensation if the participation makes a substantial contribution to a board order or decision.

(c)  The board shall award reasonable advocate fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a hearing or proceeding to any customer who complies with section 35 of this title and the municipality’s presentation makes a substantial contribution to the adoption, in whole or in part, of the board’s order or decision.

§ 35.  INTERVENOR FUNDING PROCESS

(a)(1)  A municipality that intends to seek an award under section 34 of this title and this section shall, within 30 days after the prehearing conference, file and serve on all parties to the proceeding a notice of intent to claim compensation.  In cases where no prehearing conference is scheduled or where the board anticipates that the proceeding will take less than 30 days, the board may determine the procedure to be used in filing notice of intent to claim compensation.  In cases where the schedule would not reasonably allow parties to identify issues within the 30 day time frame, or where new issues emerge subsequent to the time set for filing, the board may determine an appropriate procedure for accepting new or revised notices of intent.

(2)(A)  The notice of intent to claim compensation shall include both the following:

(i)  A statement of the nature and extent of the municipality’s planned participation in the proceeding to the extent possible to be filed with the notice of intent.

(ii)  An itemized estimate of the compensation that the municipality expects to request.

(B)  Within 15 days after service of the notice of intent to claim compensation, the board may direct the staff and may permit any other interested parties to file a response to the notice.

(b)  The board shall issue a preliminary ruling addressing whether the municipality will be eligible for an award of compensation and issues raised by the notice of intent to claim compensation within 30 days after receipt of the notice.  The ruling may point out similar positions, areas of potential duplication in showings, unrealistic expectation for compensation, and any other matter that may affect the municipality’s ultimate claim for compensation.  Failure of the ruling to point out similar positions or potential duplication or any other potential act on the ultimate claim for compensation shall not imply approval of any claim for compensation.  Similarly, the failure of the municipality to identify a specific issue in the notice of intent or to estimate precisely potential compensation shall not preclude an award of reasonable compensation if a substantial contribution is made.

(c)  Following issuance of a final order or decision by the board in the hearing or proceeding, pursuant to subsection (b) of this section, a municipality that has been found to be eligible for an award of compensation may file a request for an award within 60 days.  The request shall include at a minimum a detailed description of services and expenditures and a description of the municipality’s substantial contribution to the hearing or proceeding.  Within 30 days after service of the request, any other party may file a response to the request.

(d)  The board may audit the records and books of the municipality to verify the basis for the award.  The board shall preserve the confidentiality of the municipality’s records.  Within 20 days after completion of the audit, the board shall prepare and file an audit report.  Any other party may file a response to the audit report within 20 days.

(e)  Within 75 days after the filing of a request for compensation pursuant to subsection (c) of this section or within 50 days after filing the audit report, whichever occurs later, the board shall issue a decision regarding whether the municipality made a substantial contribution to the final order or decision.  If the board finds that a substantial contribution was made, the board shall describe the substantial contribution and shall determine the amount of compensation to be paid.  The award of compensation shall consider market rates paid to persons of comparable training and experience who offer similar services.  The compensation awarded shall not exceed comparable market rates of persons of comparable training and experience offering similar services paid by the board or the public utility, whichever one pays the greater rate.

(f)  The board shall deny an award to any municipality that attempts to delay or obstruct the orderly and timely fulfillment of the board’s responsibilities.

* * * Burial of Transmission Line * * *

Sec. 2.  30 V.S.A. § 248(m) is added to read:

(m)(1)  Applications for a certificate for a transmission facility that propose to place overhead transmission lines adjacent to schools, residential areas, public buildings, or in areas where transmission lines would unduly impair scenic vistas essential to the economic vitality of the community shall be presumed to be inconsistent with the public good.  An applicant may rebut this presumption by demonstrating to the board that it will be technologically infeasible to bury the line and there is not a viable alternative route.  In determining infeasibility, the board shall consider whether burying the line will have an impact on the reliability of the electric transmission system of the state.

(2)  If a certificate under subsection (a) of this section is granted for a transmission facility, all prudent costs associated with the reconfiguration or burial of the electric transmission lines shall be deemed to be reasonable and recoverable by the electric distribution company in its rates.

(3)  In instances in which the board finds that an overhead transmission line does not unduly impair scenic vistas, a municipality may nevertheless petition the board to have the transmission line placed underground.  The board may allow the line to be placed underground if such placement is feasible and safe, with the municipality taking responsibility for paying the incremental cost.

* * * Transmission and Distribution Planning * * *

Sec. 3.  30 V.S.A. § 218c(d) is added to read:

§ 218c.  LEAST COST INTEGRATED PLANNING

* * *

(d)(1)  Nontransmission strategies.  Any utility that owns or operates or any combination of utilities that together own or operate the bulk electric system facilities serving the state of Vermont, as its obligation to file a least cost integrated plan pursuant to this section and not later than July 1, 2006, shall prepare and file with the department of public service, the public service board, the house committees on commerce and on natural resources and energy, and the senate committees on finance and on natural resources and energy a Vermont bulk electric system reliability plan that looks forward for a period of at least ten years and that:

(A)  identifies existing and potential bulk system reliability deficiencies by location within Vermont;

(B)  estimates the date and identifies the local or regional load levels and other like system conditions at which such reliability deficiencies, in the absence of further action, would likely occur;

(C)  estimates the design and costs of transmission improvements necessary to resolve the identified deficiencies;

(D)  identifies potential obstacles to the realization of transmission solutions; and

(E)  specifies the demand or supply parameters that generation demand response energy efficiency or other nontransmission strategies would need to address to resolve the reliability deficiencies identified.

(2)  Plan objective.  The objective of the plan shall be to identify the potential need for bulk system improvements as early as possible in order to allow sufficient time for distribution utilities, market participants, and entities appointed by the public service board pursuant to subdivision 209(d)(2) of this title to plan and implement non-transmission strategies to meet reliability needs wherever those strategies are feasible and more economical than transmission system improvements and consistent with the principles of least cost integrated planning pursuant to this section and the requirements of subdivision 248(b)(2) of this title.

(3)  Public meetings and approval.  Prior to submission to the board of the first Vermont bulk electric system reliability plan, revisions, and updates, the preparer of the plan shall host at least two public meetings at which the preparer shall present a draft of the plan.  The meetings shall be at separate locations within the state that are in close proximity to any bulk electric system facilities additions or improvements identified or proposed in the plan, and each meeting shall be noticed by at least two advertisements, appearing between one and three weeks prior to the meetings in newspapers having general circulation within the state and within the municipalities in which the meetings are to be held.  Copies of the notices shall be provided to the public service board, the department of public service, any entity appointed by the public service board pursuant to subdivision 209(d)(2) of this title, the agency of natural resources, the division for historic preservation, the department of health, the scenery preservation council, the state planning office, the agency of transportation, the attorney general, the chair of each regional planning commission, each utility providing retail electric service within the state, the Vermont Natural Resources Council, the Preservation Trust of Vermont, and any other public interest group that requests or has made a standing request for a copy of the notice.  The preparer of the plan shall prepare a verbatim transcript of each meeting that shall be filed with the public service board and the department of public service and provided at the cost of 10 cents per page, or at no charge in electronic format, to any person requesting a transcript.  The plan shall contain a discussion of the principal contentions made at the meeting by members of the public, by any state agency, and by any utility.

(4)  Information exchange.  Prior to the issuance of the Vermont bulk electric system reliability plan or any revision, the preparer of the plan shall offer to meet with each utility providing retail electric service within the state, with any entity appointed by the public service board pursuant to subdivision 209(d)(2) of this title, and with the department of public service for the purpose of exchanging information that may be relevant to the development of the plan.

(5)(A)  Revision.  The Vermont bulk electric system reliability plan shall be revised and updated:

(i)  within nine months of a request to do so made by either the public service board or the department of public service, and

(ii)  in any case, at intervals of not more than three years.

(B)  If more than 18 months has elapsed between the filing of any version of the plan and the next revision, prior to issuance the next revision, the sponsor of the plan shall conduct public meetings as provided in subdivision (3) of this subsection, and the revision shall include a discussion of the principal contentions made at the meetings by the public, any state agency, and any utility.

(6)  Authority.  On the basis of information contained in the Vermont bulk electric system reliability plan or obtained through meetings held pursuant to subdivision (3) of this subsection or otherwise, the public service board and the department of public service shall use their authority under this title to encourage and facilitate the resolution of reliability deficiencies through non‑transmission alternatives where such alternatives would better serve the public good.  The public service board may, upon notice and hearings required under this title and under the authority conveyed by sections 209, 210, and 2801 of this title, enter orders it deems necessary to encourage, facilitate, or require resolution of reliability deficiencies in the manner it determines will best promote the public good.

(7)  Retail electricity provider input.  The retail electricity providers in affected areas shall reflect the information contained in the most recent version of the Vermont bulk electric system reliability plan in their individual least cost distribution and supply planning and implementation strategies, shall develop joint least cost solutions, and shall cooperate in implementing those solutions necessary to address the reliability deficiencies identified in the plan.

Sec. 4.  30 V.S.A. § 209(d) is amended to read:

(d)(1)  The public service department, any entity appointed by the board under subdivision (2) of this subsection, all gas and electric utility companies, and the board upon its own motion, are encouraged to propose, develop, solicit, and monitor energy efficiency and conservation programs and measures, including appropriate combined heat and power systems that result in the conservation and efficient use of energy and meet the applicable agency of natural resources’ air quality standards.  Such programs and measures, and their implementation, may be approved by the board if it determines they will be beneficial to the ratepayers of the companies after such notice and hearings as the board may require by order or by rule.

(2)  In place of utility-specific programs developed pursuant to section 218c of this title, the board may, after notice and opportunity for hearing, provide for the development, implementation, and monitoring of gas and electric energy efficiency and conservation programs and measures, including appropriate combined heat and power systems that result in the conservation and efficient use of energy and meet the applicable agency of natural resources’ air quality standards, and including programs and measures delivered in multiple service territories, by one or more entities appointed by the board for these purposes.  The board may specify that the implementation of these programs and measures satisfies a utility’s corresponding obligations, in whole or in part, under section 218c of this title and under any prior orders of the board.

* * *

(4)  The charge established by the board pursuant to subdivision (3) of this subsection shall not exceed the amount needed to provide $17,500,000.00 to support all energy efficiency programs for Vermonters authorized by the board by rule or order pursuant to subdivision (2) of this subsection in any fiscal year. No more than $17,500,000.00 of financial support for energy efficiency programs for Vermonters shall be authorized by the board by rule or order pursuant to subdivision (2) of this subsection in any fiscal year be in an amount determined by the board by rule or order that is consistent with the principles of least cost integrated planning as defined in section 218c of this title.  In setting the amount of the charge and its allocation, the board shall determine an appropriate balance among the following objectives: providing efficiency and conservation as a part of a comprehensive resource supply strategy; providing the opportunity for all Vermonters to participate in efficiency and conservation programs; and promoting the value of targeting efficiency and conservation efforts to locations, markets, or customers where they may provide the greatest value.  The board by rule or order shall establish a process by which a customer may apply to the board for an exemption from some or all of the charges assessed under this subdivision.  The board shall establish criteria by which these applications shall be measured.  Any such exemption shall extend for a period of time not to exceed one year.  In addition, the board may authorize exemptions only if, at a minimum, a customer demonstrates that, during the preceding year, it implemented an extraordinary amount of cost‑effective energy efficiency at the customer’s own expense or incurred extraordinary costs on those measures and that the customer did not and will not receive reimbursement for those measures from the entity designated by the board under this section.

Sec. 5.  30 V.S.A. § 218c(a)(2) is amended to read:

(2)  “Comprehensive energy efficiency programs” shall mean a coordinated set of investments or program expenditures made by a regulated electric or gas utility or other entity as approved by the board pursuant to subsection 209(d) of this title to meet the public’s need for energy services through efficiency, conservation, or load management in all customer classes and areas of opportunity which is designed to acquire the full amount of cost effective cost-effective savings from such investments or programs.  Among these programs, the board shall allow appropriate combined heat and power systems that result in the conservation and efficient use of energy and meet the applicable agency of natural resources’ air quality standards.

Sec. 6.  VERMONT ELECTRIC COOPERATIVE; COSTS TO DEVELOP

             COGENERATION PLANTS RECOVERABLE IN RATES; PILOT                             PROJECTS

Expenses, up to $500,000.00 for each project, incurred by Vermont Electric Cooperative (VEC) to develop a cogeneration plant in the Beecher Falls area and in the Richford area shall be considered by the Public Service Board to be just and reasonable if the expenses are prudently incurred and reasonably lead to the operation of a cogeneration plant.  In order to assure that these expenses are recovered in electric rates, the board shall grant a request by VEC to record these expenses in its financial books as a regulatory asset and to defer recovery of the expenses until its electric rates can be adjusted to include these expenses.  VEC shall recover capital costs during the period cost recovery is deferred.

Sec. 7.  COGENERATION COLLABORATIVE; DESIGN DEVELOPMENT

A cogeneration collaborative is established to consist of Green Mountain Power Corporation (GMP), Vermont Gas Systems, Inc. (VGS), and others as required.  The Regulatory Assistance Project is requested to assist in the preliminary planning of a cogeneration facility at an appropriate location.  GMP and VGS may contribute $15,000.00 each to pay for these planning efforts.  These costs shall be considered by the Public Service Board to be just and reasonable if they are prudently incurred and are reasonably intended to lead to the operation of a cogeneration plant.  In order to assure that these costs are recovered in electric rates, the board shall grant requests by GMP and VGS to record the costs in its financial books as a regulatory asset and to defer recovery of these costs until its electric rates are adjusted to include these costs.  A progress report shall be filed on or before January 15, 2006 with the senate committees on economic development, housing and general affairs and finance and the house committees on commerce and natural resources and energy.

Sec. 8.  STUDY ON STANDARDS AND INCENTIVES FOR GREEN

             BUILDINGS

The Department of Public Service and the energy efficiency utility established by board order under 30 V.S.A. § 209(d) shall study the establishment of standards for and different methods for providing incentives to the construction or rehabilitation of green buildings.  The study shall evaluate green construction programs in other states and the United States Green Building Council’s LEED rating system and shall identify and estimate potential energy savings and savings to taxpayers if schools and other public buildings were to be constructed as green buildings.  The department shall consult with the Vermont division for historic preservation to ensure that the study takes into consideration the concerns of the division.  The results of the study including recommendations for legislative action shall be included in a written report to be submitted to the senate committee on finance and the senate committee on economic development, housing and general affairs, and the house committee on commerce and the house committee on general, housing and military affairs on or before January 1, 2006.

Sec. 9.  EFFECTIVE DATE

This act shall take effect upon passage.  Notwithstanding any requirement that requires notice and pre-approval to seek reimbursement for costs and expenses relating to municipal intervention, the public service board shall consider any applications filed within 60 days of the effective date of this act from municipalities for compensation in Docket No. 6860, In Re:  VELCO Northwest Reliability Project.  The board will determine compensation pursuant to the criteria set forth in section 34 of Title 30.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us